Toyota to take private key unit in $26 billion deal
will take private a key supplier of its group, it said on Tuesday, in a $26 billion deal, marking a landmark repositioning of Japan's most important corporation.
Under the terms of the deal, unlisted real estate company
Toyota Fudosan
will launch a tender offer for shares of
Toyota Industries
for 3.7 trillion yen ($26 billion), the companies said.
Separately, Toyota said it plans to buy back its own shares from Toyota Industries.
Japanese companies have come under growing scrutiny from the market regulator and investors in recent years about their
cross-shareholdings
in affiliates and business partners, sparking a rise in both
management buyouts
and acquisitions.
Many of the deals have been driven by expectations that a
corporate governance
overhaul will bring better shareholder returns.
Live Events
Toyota had said in April it was considering participating in a potential buyout of Toyota Industries - a move that sources have said would help improve the group's corporate governance.
Toyota owned about 24% of Toyota Industries as of September last year, while Toyota Industries held around 9% of the world's biggest automaker and more than 5% of Denso, another major Toyota supplier and Toyota group company.
Toyota Industries, formerly Toyoda Automatic Loom Works, was founded in 1926 by Sakichi Toyoda to make automatic looms. An
automotive division
within the company was set up and later spun off as Toyota Motor.
In addition to forklifts, Toyota Industries manufactures the RAV4 sport utility vehicle for Toyota and also produces car parts such as engines, air-conditioning compressors, batteries and converters.
Economic Times WhatsApp channel
)
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Mint
11 minutes ago
- Mint
US-Japan Trade Deal: Auto stocks fuel Nikkei rally, Yen strengthens, gold price eases on Trump announcement — Top points
US-Japan Trade Deal: US President Donald Trump on Tuesday announced a trade deal with Japan as countries race to ink agreements with America before the August 1 tariff deadline. Japan will pay a tariff of 15 per cent on goods imported in the US, Trump said. This includes tariffs on auto import. This is a significant drop from the 25 per cent tariffs that Trump had threatened to impose from August 1, as per his letter to Japanese Prime Minister Shigeru Ishiba. The US-Japan trade deal would include $550 billion of Japanese investments in the United States, Trump said in a post on Truth Social, and added that Japan would increase market access to American producers of cars, trucks, rice and certain agricultural products, among other items. Japanese PM Ishiba on Wednesday acknowledged the new trade agreement, saying it would benefit both sides and help them work together. Under the agreement, auto tariffs will also be slashed, Ishiba confirmed. 'We are the first (country) in the world to reduce tariffs on automobiles and auto parts, with no limits on volume,' he told reporters. A Trump official also confirmed the development, saying auto tariffs will be charged at 15 per cent. However, US and Japan agreed to keep the current tariff on steel and aluminium at 50 per cent as part of their bilateral trade deal, Japanese public broadcaster NHK reported on Wednesday. Japanese stocks, fulled by a rally on auto shares, surged higher on the announcement of the agreement. The benchmark Topix and Nikkei 225 share gauges both moved up over 2 per cent, with gains accelerating after the announcement. Shares of Toyota Motor Corp. jumped over 10 per cent. The Nikkei rallied 2.4 per cent to 40,731.86, as of 0121 GMT, with the Tokyo Stock Exchange's transport equipment index surging 8.4 per cent as the news of the trade deal brought cheers to investors. The Yen also reacted positively on the news, strengthening to 146.20 per dollar as compared with close to 148 on Tuesday. Oil prices steadied in early trading on Wednesday after falling for three consecutive sessions as a result of the US-Japan trade deal, with Brent crude futures rising by 33 cents, or 0.48 per cent, to $68.92 a barrel by 0023 GMT. Gold prices eased on Wednesday as the US-Japan trade deal fuelled a risk appetite among investors. Spot gold was down 0.2 per cent at $3,423.44 per ounce, as of 0136 GMT, according to a report by Reuters. (With inputs from agencies)
&w=3840&q=100)
Business Standard
11 minutes ago
- Business Standard
Trump lowers Japan's tariff rate to 15%, says Tokyo to invest $550 bn in US
US President Donald Trump on Wednesday (IST) said that he has reached a trade deal with Japan, bringing down the tariff rate imposed on Japanese goods from 25 per cent to 15 per cent. Trump announced this on his private social media platform, Truth Social. He said, "We just completed a massive Deal with Japan, perhaps the largest Deal ever made. Japan will invest, at my direction, $550 Billion Dollars into the United States, which will receive 90% of the Profits." [sic] He further went on to claim that this trade deal with Japan "will create Hundreds of Thousands of Jobs — There has never been anything like it. Perhaps most importantly, Japan will open their Country to Trade including Cars and Trucks, Rice and certain other Agricultural Products, and other things. Japan will pay Reciprocal Tariffs to the United States of 15%." [sic] At a White House event, Trump also hinted at signing a joint venture deal with Japan to export liquefied natural gas from Alaska, Bloomberg reported. Japan's reaction to lower tariff announcement Prime Minister Shigeru Ishiba said, "Japan and the US have been conducting close negotiations with our national interests on the line", adding that the two nations will continue to work together to create jobs and good products. Trump sends new tariff rate letter to Japan The recent deal marks a shift in Trump's stance and comes weeks after he sent out a letter to Japan and South Korea, informing them of new tariff rates. Earlier on July 7, the US President cited persistent trade deficit with Japan and South Korea as the reason for charging them a 25 per cent tariff, which will come into effect on August 1, 2025. In the letter addressed to Japanese Prime Minister Shigeru Ishiba, Trump warned the country against retaliatory measures and stated, "If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 25% that we charge.' He also added that these tariffs may be modified upward or downward, depending on Washington's relations with the respective countries.
Indian Express
11 minutes ago
- Indian Express
Japan Prime Minister Shigeru Ishiba to resign by August: Report
Japanese Prime Minister Shigeru Ishiba has reportedly planned to resign from his post by August, Reuters reported on Wednesday citing Mainichi newspaper. This comes after US President Donald Trump announced a 'massive' trade deal with Japan on Tuesday, with Tokyo paying 15% reciprocal tariff and investing $550 billion in the United States.
